06-23-2016, 12:02 PM
(06-23-2016, 11:56 AM)jdhansen Wrote: Thanks for the warm welcome and advice so far.
I choose to use Robinhood for the zero commissions and no required minimum to open an account which is nice when you start out. I also like the idea of being able to use my dividends toward the purchase of other stocks versus having them automatically reinvested for me, not a huge fan of fractions.
My initial plan is to build a core of 5-10 holdings and than see where to go from there.
The Criteria I have set up so far is as follows: I wonder if it is a bit to constrictive as I have notice many of the Companies that are suggested as core holdings in blogs don't fit these rules at this current time in the market, or do I need more factors to get a more accurate picture?
Dividend rate between 2.5% and 5%
PE at less than 20%
Payout Ratio less than 80%
Dividend growth of at least 25+ years
Do I know what they do/produce.
Looks like there are a few more measures I need to start considering. I have seen the Chowder Rule mentioned by others, but have not quite understood what it measures versus years of dividend growth. I will need to research some more.
Overall I like your requirements, although I would argue there are plenty of great companies with sustainable dividends that don't have a 25-year streak of increases.